While having an extended warranty can sometimes save you appliance repair costs downstream, it can in certain circumstances, be a waste of money. The nature and benefits of extended warranties have greatly changed in the last decade and with the emergence of third party insurers, it behooves the smart shopper to do their research before buying an extended warranty for a new appliance.
What Value Are You Actually Getting?
An important consideration when looking at an extended warranty is how the cost of the policy compares to the price of the appliance. Buying a $30 extended warranty for a small appliance worth $70 just does not make sense, but a $70 2-year warranty for a major appliance would be added value.
It's also wise to review the policy detail including all the fine print. This is sometimes difficult to do in a crowded retail outlet when you're making a purchase, but buying blind should never be an option. Find out if there is an eligible timeframe after buying the item to get the extended coverage, and if you can have a copy of the service contract to read before buying.
It's rare to find warranties that provide full repair or replacement of all components, most will have limited clauses. Find out what the warranty does cover and whether it includes labor and shipping, or in the case of a large appliance, a home service call. These charges can add up and in some cases, the total cost to have an appliance repaired under an extended warranty, could be higher than replacing the item in the first place.
You cannot assume that an extended warranty covers the very same detail as your initial manufacturer's warranty. If warranty details sound confusing or vague, ask for an explanation to make sure you understand fully what will be covered and who will do the work.
How Long Will the Warranty Period Be Extended?
A new appliance usually comes with a manufacturer's warranty already included in the price and this period will vary. If your new washer has a one year warranty period, you should consider how much further the coverage will be extended when you purchase a service contract. You should also ask when the extended period will start to ensure you are not paying for duplicate coverage.
Considering Reliability & Durability:
If the cost of an extended warranty is high and you're not sure if it's worth it, you might want to consider other factors such as the reliability of the appliance brand or how durable the appliance will be - whether it will stand up to the next few years of constant use. Will it get light or heavy duty use in your home?
When it comes to an appliance with high tech features, servicing it yourself or by a local handyman may not be adequate and you may need to pay for a qualified technician. In this case, extended coverage may be a good idea, as long as these types of repairs are included in the warranty.
Some retailers do offer over-the-counter replacements for certain purchases. In this case, if there is any hint of problems with the item, you may be able to get it replaced easily before this coverage ends and save the cost of an additional warranty.
Buy an Extended Warranty Only From a Trusted Source:
Many third parties now offer extended warranties. In fact, some manufacturer warranties may also be honored by a contracted firm. Research the company offering the extended warranty coverage and buy only from a trusted source. The best source for extended coverage is from the manufacturer where servicing is done by someone who knows the product and has original parts.
When You Need to Make a Claim:
It's a good idea to file your extended warranty papers along with your product manual and to make note of the ending coverage date. When and if you need to make a claim, review the policy for servicing and shipping instructions. If in doubt that the problem may be covered, avoid uneccesary charges by calling first to confirm coverage. Keep a record of the date and shipping details.
After the Purchase - What to do After You Bring the Appliance Home
10 Reasons to Read Your Product Manual
The Bottom Line
If the price is reasonable, the appliance will more than likely need servicing in the future and coverage includes most parts and components, an extended warranty is well worth the expense. But only buy from a trusted source and always read the entire policy.
Read More About Appliances:
Appliance Buying Tips
How to Handle Appliance Concerns & Why the Manufacturer Needs to Know
Why Register Your Appliance?
Sources for Appliance Parts & Repairs
Why Buy EnergyStar Appliances?
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